What the Pentagon’s Rare Earths Deal Gets Right and Wrong

The article discusses the Pentagon's recent deal to secure rare earth elements (REEs), which are critical for various high-tech applications. The deal aims to reduce the U.S. reliance on China, the dominant global supplier of these materials. The article highlights both the strengths and shortcomings of the Pentagon's approach. On the positive side, it recognizes the strategic importance of securing domestic or allied sources of REEs to mitigate supply chain risks. However, the article also points out that the deal focuses primarily on the downstream processing of REEs rather than addressing the entire supply chain, including mining and refining. Furthermore, the article suggests that the Pentagon's approach may not be cost-effective and could potentially distort market dynamics. It also raises concerns about the long-term sustainability of this approach, given the capital-intensive nature of the rare earth industry. Overall, the article provides a nuanced analysis of the Pentagon's rare earth deal, acknowledging its potential benefits while also highlighting the challenges and limitations of the government's intervention in this critical industry.